Mining giant Xstrata, signs off a 122 million US dollar investment in PNG

Mining company Xstrata has signed off on a 122 million US dollar investment in its 5.3 billion dollar Papua New Guinea copper-gold joint venture with Highlands Pacific.

The decision takes its investment in the project to more than 250 million dollars.

The newspaper, the National, reports Australian-listed Highlands Pacific said the investment would fund a bankable feasibility study on the Frieda project, following the recent release of a pre-feasibility study, which showed the site was a world-class asset.

The pre-feasibility study estimated that the project would produce an average of 246,000 tonnes per annum of copper and 379,000 ounces of gold in the first eight years.

The company says that would potentially place Frieda in the top 15 of the world's current copper mines and among the lowest in operating costs.

Xstrata needs to finalise the bankable feasibility study by January 2012 to maintain its 81.82% interest and management rights of the project.